Build magazine august 2015

Corruption Risk in the Construction Industry / Adapting to the BIM way of working for longer-term value

The Skills Shortage Facing UK Construction Does the industry need an image overhaul to attract new staff?

Solar Subsiding As the UK Government cuts renewable energy subsidies, could this be a good thing for the industry?

Calling the Crowd Crowdfunding is revolutionising the US construction industry.

Also in this month’s issue...

Beauty is in the Eye of Security Camera How can the architecture sector combine security with atheistic merit?

Carbon Confrontational What the UK Government’s backtracking on carbon neutral homes means for industry.

Build Magazine Issue Four: August 2015

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Editor’s Letter Welcome to the August Edition of Build Magazine.

This month, Allen Preger of Newforma talks us through the BIM level 2 mandate and how this could potentially create a more collaborative environment within the UK construction industry.

We focus on funding, with Richard Bush, the Co-founder of CrowdLords.com discussing how crowdfunding is taking its place in the US construction industry and Andy Monteith discussing how to avoid problems in bid management.

The UK Government has been causing issues in the energy efficiency market recently. David Taylor talks us through how the end of renewable energy subsidies could help, rather than hinder, the solar power sector if handled correctly and the UK Government’s carbon neutral homes rejection is analysed by Neelum Mohammed.

The skills shortage comes under the spotlight this month as we examine the effect it is having on the UK construction environment and how the industry needs to act if it is to solve the issue.

Multipurpose architecture which both protects and pleases is the subject of scrutiny by Jonathan Goss.

Opportunities for international construction firms in East Africa are examined by Andrew Ross as he argues that improved infrastructure will offer international construction firms valuable opportunities.

We hope you enjoy the issue.

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Contents 4. News

Inside the Industry 12. Bid Management… or Bid Mismanagement?

“This project is over budget, we aren’t going to deliver on time, the customer is not happy with us”.

16. Corruption Risk in the Construction Industry

By Lloyd Firth of International Law Firm, WilmerHale

20. Crowdfunding and Development Finance Richard Bush, Co-founder of CrowdLords.com, discusses how crowdfunding is changing the face of funding in the US property market.

24. East Africa’s Growth Story: Opportunities for International Construction Firms Andrew Ross, CEO of Spencon Ltd examines how East Africa offers international firms potential opportunities as infrastructure and the economy improve.

26. How the Skills Shortage is Affecting Construction 28. The Skills Shortage: An Industry Perspective Does the industry need an image overhaul to attract new staff?

Eco Building 32. Carbon Emission U-Turn Can Only Create Market Uncertainty

By Neelum Mohammed, Associate Director in Sustainable Engineering at CBRE

34. Act Now to Make the Most of the PV Opportunity

By David Taylor, National Sales Manager, Flogas Renewables For more information visit Flogas.co.uk.

Regulation 40. Adapting to the BIM Way of Working for Longer-Term Value

By Allen Preger, Co-Founder and VP Global Accounts, Newforma

Real Estate 46. Meeting the Evolving Challenges of Architectural Security in a Global Age

By Jonathan Goss, managing director, Townscape Products Limited Build Magazine

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News Oslo Youth Olympics Shows Environmental Credentials The 2016 Youth Olympic Games goes sustainable with Kebony cladding.

Lillehammer, the site of the upcoming 2016 Youth Olympic Games, is soon to open the doors for a new development of student accommodation, which - in line with ‘passive house’ standards - has put environmental credentials at the forefront of the design and selection of construction materials.

The development, designed by Henning Larsen Architects and SGB, is named SOPP (short for Studentsamskipnaden i Oppland), as it will house students in its 360 apartments across four blocks.

The whole development is clad in Kebony’s sustainable, durable wood that will offer resistance to the chilly, windswept climate of the mountainous, lakeside Gudbrandsdal region.

Preparations have long been underway across the municipality for the second ever Winter Youth Olympic Games, which will see 1,100 young athletes from 70 nations, gather for 10 days of sports, education and celebration. 70 medal events within 15 traditional winter disciplines have been scheduled and a number of brand new events included. The Youth Olympic Games will serve as a platform for development for young athletes between 15 and 18 years old, not only through high level sporting competitions, but through the educational programme Learn & Share.

Sustainability has been given precedent across new infrastructure in the run up to this momentous

sporting event, and this student development and it meets the passive house requirements, wherein the energy consumption is minimised. In the Lillehammer area this means that the energy consumption for heating should be less than 20 kWh/m2/year.

A new heating plant will produce all of the heat for the internal heating and for hot water. The water from this district heating plant is heated by bio fuel produced by local trade in the Lillehammer region – a mixture of wood chips, saw dust, branches, roots and treetops. It is estimated that approximately 90-95 % of the produced heat in a normal year will come from renewable resources.

Kebony’s superior environmental credentials set it apart from more conventional woods which would likely deteriorate over time or involve the use of environmentally-damaging treatment; it requires no maintenance beyond normal cleaning and has no harmful effects on the environment.

In addition, the timber has been used to great effect to reflect the aesthetic trend of using wood in cold-climate Norwegian architecture that is echoed across Lillehammer.

Each flat is from 18.2 m² to 18.4 m² with a total floor space of approximately 13,000 m². Each apartment contains an en suite bathroom and a kitchenette and has access to a shared social room. The first students are expected to move in sometime in early autumn; around the same time at which the Olympic Village will open its doors to the young sporting elite from around the world who will descend on the mountainous municipality.

Petter Syverud, the development’s Project Manager at Ekstenso, commented ‘We wanted to incorporate sustainability into this project, without compromising on the aestheticism or nuance of its design – Kebony provided an opportunity to do just that.’

Adrian Pye, International Sales Director at Kebony said: “It is pleasing to see a move towards the use of more sustainable materials like Kebony in the run up to this exciting sporting occasion. We hope that Kebony’s durability will ensure this development becomes an important and popular facet of Lillehammer’s town centre.’

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Will Heat Regulations Leave Landlords Hot Under the Collar?

Landlords may need to act on the new Heat Regulations. Winckworth Sherwood’s Colin Hall and Niall Carey explain.

Landlords managing existing buildings of any type will need to ask themselves the two following questions before the end of this year: • Are any of those buildings heated, cooled or supplied with hot water from a central internal or off-site boiler or chiller?

• If so, is it caught by The Heat Network (Metering and Billing) Regulations 2014?

If the answer to these two questions is yes, you could be what the regulations call the ‘heat supplier’ with responsibility to: • Tell the National Measurement and Regulation Office that your central system exists and to provide them with technical details so that they can build a map.

• Consider putting in meters to measure the heat consumption.

• Maintain meters so that they remain accurate and always in operation.

• Use the meters to provide customers with detailed information on the heat bills.

What buildings are caught by the new regulations?

A building is probably caught by the Heat Regulations if it receives heat from a boiler shared with other buildings, or if the building has its own boiler which serves more than one customer. This covers a potentially very wide range of buildings including: • Residential/commercial and mixed use developments • Existing blocks of flats • Flat conversions and bedsits (with a central boiler) • Leisure centres (with concession holders) • Supermarkets (with concession holders) • Shopping centres • Office buildings with more than one tenant • Some university campuses

Dundee Railway Station Contract Awarded Balfour Beatty joint venture awarded £416mn London ‘Super Sewer’ scheme.

Are meters needed in all buildings?

New buildings must have them installed from the start. For existing buildings, there is time to consider whether it is feasible to install them. There are various rules and exceptions, but if the building is caught, meters must be installed by 31 December 2016.

Balfour Beatty, the international infrastructure group, today announces that its joint venture with Morgan Sindall and BAM Nuttall has been awarded a £416mn contract to construct part of London’s new ‘super sewer’, the Thames Tideway Tunnel, for Bazalgette Tunnel Limited.

Feasibility depends on two questions – would meters be cost effective, and are they technically feasible? These depend on the use of the building and its fabric. Once installed, meters must be kept accurate and bills fully loaded with the information they record. If meters are not feasible, landlords will have to consider whether ‘heat cost allocators’ would be a feasible alternative.

The Thames Tideway Tunnel will ensure the capital’s sewerage system is fit to support its projected population for at least the next 100 years, and will tackle the issue of discharges of untreated sewage that currently enter the River Thames on a regular basis.

Who is responsible?

The ‘heat supplier’ must perform these new duties – that is the person who sells the heat (or cooling) to a ‘final customer’, or the person who actually consumes the heat.

So what action should you take? The starting point is to look at the heat supply contracts to decide if you are the heat supplier. On large developments the management company may fulfil that role, unless they have outsourced it all to an energy services company. In a smaller entity the landlord may have the role, in which case they need to make sure they know who is performing the duties.

Enforcement of the new duties is by an escalating regime that includes a formal compliance notice, possible compensation to tenants, civil penalties and criminal sanctions as well as publication of offenders’ names.

Colin Hall is a partner and Niall Carey a senior associate in the Community Infrastructure team at Winckworth Sherwood. Winckworth Sherwood has prepared a more detailed briefing on the new Heat Regulations that can be found at www.wslaw.co.uk

Balfour Beatty’s three-way equal joint venture, which is known as BMB and was appointed as preferred bidder for the scheme in February 2015, will create the six kilometre ‘West’ section of the 25km Thames Tideway Tunnel.

BMB’s ‘West’ section will run from Acton in West London to Wandsworth in South West London and will incorporate seven separate work sites along the route. Works will include design, construction, commissioning and maintenance for a two to five year period following construction completion.

A digital construction approach utilising Building Information Modelling (BIM) will allow full testing and simulation of construction activity before works start on site for safe and efficient delivery.

Project materials will be transported down the River Thames to ease road congestion, emissions and disruption throughout the duration of the project.

The Thames Tideway contract builds upon Balfour Beatty’s expertise in delivering large multi- disciplinary tunnelling contracts in sensitive areas including the Crossrail Liverpool Street and Whitechapel Station tunnels and the A3 Hindhead tunnel.

Mobilisation work for the ‘West’ tunnel will begin in September this year with completion scheduled for 2022. The Thames Tideway Tunnel project will create more than 9,000 direct and indirect jobs at the peak of construction.

Leo Quinn, Balfour Beatty Group Chief Executive said: “Balfour Beatty’s expert teams have for many years helped to make the London landscape – both visible and invisible – what it is today, ensuring it can to continue to grow as one of the world’s leading capital cities. The award of this unique infrastructure project, which is part of the largest ever undertaken by the UK water industry, is another example of the part we are playing in 21st Century engineering.

“At the same time, together with our joint venture partners, we are committed to delivering tangible benefits for our local communities and their economy - through sensitive construction, engaging local businesses and SMEs into our supply chain and providing local job opportunities, including 50 new apprenticeships.”

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Window to Skills Shortage Solution Window manufacturer backs apprenticeships to fill skills gap.

After recent statistics suggest over-qualification is at ‘saturation point’ one of the North’s leading window manufacturers is calling on school leavers to seriously consider the benefits of apprenticeships.

Ian Harrison, managing director at Goldthorpe based Building Product Solutions who has long been an advocate for the apprenticeship scheme, said: “Apprenticeships work well for both the young person and the company. Not only does the apprentice become skilled in their chosen industry – they learn the ins and outs of the business.”

The latest study from the Chartered Institute of Personnel and Development shows that the UK currently has 58.8% of graduates working in jobs that don’t typically require a degree.

This trend was particularly high in the construction and manufacturing industry where apprenticeships have always been a traditional route into the industry. It means that whilst graduates are looking jobs which typically wouldn’t require a degree, those without are facing stiff competition.

Statistics from yesterday’s GCSE results show that although the percentage of pupils achieving a C grade or above has risen, those achieving the top grades has seen a slight fall. With universities now able to accept as many students as they’d like and with entry requirements dropping, the South Yorkshire based manufacturer is encouraging school leavers to research their other options.

“Young people shouldn’t be spending as much as they do on university fees and then worrying about career prospects. With an apprenticeship you can ‘earn while you learn.’ And 90% of apprentices stay in employment once completing their studies – you can’t argue with those figures.” Adds Ian “Apprenticeships should no longer be seen as second class. They pose a real alternative to gaining qualifications without going to university.

Manufacturing and construction in particular offer plenty of career progression and continued professional development.”

In 2013/14 academic year there was 13,700 apprenticeship starts in South Yorkshire and 440,000 in England as a whole.

Construction Sector Urged To Have Their Say On How To Close The Gender Pay Gap Final chance for businesses to respond to major consultation on how to tackle the difference between average pay rates of male and female employees

This is one of the reasons why improving the diversity of our business is a key priority for Carillion, with a particular focus on supporting women in the workplace.

Construction businesses across the country are being called on to respond to a major Government consultation on how to close the gender pay gap.

“We believe that gender diversity at all levels of our business strengthens teams, improves performance and ensures we have the skills we need to succeed.”

Latest figures show that these industries have a 22.76% pay gap – the difference between the average salaries of men and women based on hourly rates – which is higher than the national average of 19.1%.

The consultation, which was launched on 14 July and closes on 6 September explores how the new regulations on gender pay gap reporting will be designed, including what, where and when information will be published. It is also seeking views on what more can be done to encourage girls to consider the widest range of careers, support parents returning to work and help women of all ages reach their full potential and have the security of a well-paid job.

It is already unlawful to pay men and women differently for the same job - this is about understanding and overcoming other barriers that are preventing women achieving their full potential and making their maximum contribution to the economy.

Last month, Prime Minister David Cameron, announced that employers with more than 250 employees will have to publish the difference in pay between men and women as part of the Government’s ambition to end the gender pay gap in a generation.

The gender pay gap is at its lowest rate on record, and there are more women at work than ever before. There are just three weeks left for employers to respond to the consultation that explores how the new regulations will be designed.

Minister for Women, Equalities and Family Justice Caroline Dinenage commented on the issue.

“We have more women in work than ever before but the stubborn pay gap between men and women still persists. By taking steps to tackle this and increase transparency, employers can retain real talent. This isn’t just common sense, it makes good business sense too.

“That’s why we’re urging the construction sector to come forward and have their say so together we can consign the gender pay gap to the history books.”

One construction and support services firm that is already working hard to support women achieve their potential is Carillion, who have recognised that they need to support women at all levels of their career to enable them to progress. They have enhanced maternity and adoption pay, and have set up a support network for working mums which now has over 200 members.

Carillion Chief Executive, Richard Howson, added that diversity was vital to combating ongoing skills issues.

“Our industry like many others is facing a challenge to find the skilled people that it needs to be competitive.

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Greater transparency will encourage employers to be more proactive in taking action to address the gender pay gap. By taking steps to close the gap, employers can better attract, develop and retain talented women, creating a balanced and diverse workforce because maximising female talent isn’t only the right thing to do, it’s good for business and it’s good for the economy.

Many companies will not even know they have a gender pay gap. Greater transparency can therefore encourage employers to think about what may be causing this, and how they can help tackle it.

The causes of the gender pay gap are complex and there are many factors involved, not just discrimination. Other factors include: • the concentration of women working in lower-paid professions than men; • women are three times as likely as men to work part time (often in order to combine childcare and work) and part time work is on average less well paid compared to full time work • corporate culture or unconscious bias • fewer women getting to the top • sometimes personal choice Other work the Government is doing to help address the gender pay gap includes: • Extending the right to request flexible working to all employees – 20.6 million employees now benefit from this; • Introducing shared parental leave; • Introducing tax breaks for childcare; • Funding 30 hours of free childcare a week for working families with 3 and 4 year old children; • Pay secrecy clauses are now unlawful; • Introducing mandatory pay audits for companies losing equal pay claims; • Encouraging more girls to study STEM subjects, by supporting the Your Life campaign.

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News

Building Apprenticeships in Transport Sector at Heart of Government Infrastructure Investment Plans

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Government to work with industry to create more than 30,000 apprenticeships in the road and rail sector this Parliament.

This work will sit alongside the government’s National Infrastructure Plan for Skills due to be published soon.

More than 30,000 apprenticeship places will be created across the road and rail industry during the lifetime of this Parliament the government pledged on21st August.

Speaking on a visit to the National Training Academy for Rail in Northampton the Secretary of State for Transport, Patrick McLoughlin, announced the ambition in a vital boost to the transport industry.

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deliver on its ambition for 30,000 apprenticeships in roads and rail over the 5 years to 2020, working together with supply chain partners ensure the right mix of apprenticeships are on offer, including many at higher levels with training in new technologies explore upskilling the existing workforce to meet new challenges encourage greater diversity in the workforce, including attracting more women into engineering develop a co-ordinated national network of transport infrastructure skills colleges to train the transport workers of the future

Commenting on this announcement Terry Morgan said: “I’m really pleased to be leading this work. It’s vital that we develop the workforce of the future, ensuring the transport industry has the right people in the right place at the right time, and crucially with the right skills, to deliver this unprecedented programme of infrastructure work. I’m very much looking forward to working with colleagues across the road and rail industry, and to leaving a legacy of skills for the future.”

“I want to see every part of Britain benefiting from a growing economy and that is why our investment in transport won’t just help people get around, it will help them get on.”

Across the country government and industry are investing to deliver the skills the industry needs.

This includes: • the opening this autumn of the National Training Academy for Rail (NTAR) in Northampton — a joint venture between Siemens and the National Skills Academy for Railway Engineering (NSARE), co funded by government • the Crossrail tunnelling academy, which will now be the beacon academy for tunnelling across industry • Network Rail’s 7 national training centres, Larbert in Scotland, Walsall in the Midlands, Bristol in the west and Paddock Wood in the south, alongside Basingstoke, York and Swindon, which will be completed in 2016 • the opening of the new National College for High Speed Rail in 2017 which will deliver high level technical qualifications • the Roads Academy programme to train the leaders of the future • Transport for London’s work with the London Transport Museum supporting schools initiatives, including Inspire Engineering Days and ongoing support for the Royal Greenwich University Technical College equipping the students with engineering skills and expertise — TfL has also invested £1 million in training facilities at its Acton Skills and Training Centre

The skills strategy will set out how government and industry will:

In support of today’s announcement Transport Secretary Patrick McLoughlin and Terry Morgan visited

Government has committed more than £70bn to improving transport infrastructure, including the most ambitious investment in rail since the Victorian era, and the most extensive improvements to roads since the 1970s. This investment will make journeys better. It will also deliver a sustained and lasting legacy of skills and opportunity for people across the UK. To help deliver this ambition Patrick McLoughlin announced the appointment of Terry Morgan CBE to develop a transport and infrastructure skills strategy, to help the transport industry ensure a continuous pipeline of skilled workers.

Patrick McLoughlin said: “Training our rail and road workforce is essential if we want to build a transport network fit for the future. That is why I have invited Terry Morgan to join us in this vital work.

“As the chairman of Crossrail, and the forthcoming National College for High Speed Rail, Terry has a track record of building skills in the transport sector.

He is ideally positioned to work with industry to deliver a transport and infrastructure skills strategy.

the newly constructed NTAR site in Northampton, which will open its doors to students this autumn.

The academy will boost expertise and skills levels in rail engineering. Thousands of young people will gain vital training in specialist traction and rolling stock and many others will learn the skills they need to respond to new technology in the UK rail industry.

Neil Robertson CEO of NSARE said: “Over 200,000 experienced staff currently run Britain’s railways.

However, an ageing workforce together with a leap in the application of digital and modern technologies means there are now significant demands on the number and type of skills we need for the future.

“The curriculum at the National Training Academy for Rail (NTAR), developed jointly by NSARE with Siemens, has been developed to provide advanced technical knowledge in traction and rolling stock as well as broader leadership, digital, and commercial skills to meet these changing demands. We welcome the government’s commitment to creating a workforce with the advanced skills now required in this industry.”

Mark Carne, Network Rail Chief Executive said: “We need a highly skilled workforce to enable us to deliver our multi-billion pound railway upgrade plan and a network fit for the 21st century. That’s why we have a steadfast commitment to training and developing everyone from apprentices and graduates to up-skilling our 35,000-strong workforce and others across the industry with the latest digital, technical and engineering skills. We know this investment pays off with 83% of the 2,000 apprentices trained since 2005 still working for us and contributing to a safer and better railway every day.

“We’re also building for the future with a programme worth £37 million adding 3 new training centres across Britain, making a total of 7 which will be capable of delivering 270,000 training days a year for Network Rail and 250 different railway companies.”

Welcoming the announcement, Highways England Chief Executive Jim O’Sullivan said: “In order to triple the amount of investment going into England’s motorways and major A roads on an annual basis, from some £1.5 to over £4 billion, we’re going to need more industry specific skills available to us and within our business.

“The certainty of capital funding over 5 years that comes with becoming a government-owned company gives us and our supply chain the confidence to invest in people — attracting, retaining and developing capable people to deliver our expanding programme of work. An important part of this is the creation of apprenticeship opportunities across all disciplines so that we are building and maintaining a pipeline of talent into the sector.”

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Owens Corning Expands Portfolio with Advanced Building Science Solutions Introduction of new pipe insulation solutions delivers trusted performance and reliable installation For contractors, mechanical engineers and distributors.

From the exterior building envelope to the interior mechanical systems, Owens Corning is at the forefront of delivering building science-driven technology and innovation to the commercial building industry. The introduction of the all-new Owens Corning® ASJ Max FIBERGLAS™ Pipe Insulation brings additional depth to the extensive Owens Corning® pipe insulation solutions designed for hot and cold, concealed and exposed piping applications in commercial and industrial buildings.

“Owens Corning is committed to serving the commercial building market with solutions that deliver an outstanding fit for commercial pipe insulation needs,” said Todd Fister, Vice President Insulation Marketing, Owens Corning. “With the introduction of Owens Corning® ASJ Max FIBERGLAS™Pipe Insulation, contractors and mechanical engineers have the confidence of knowing we’ve got them covered with products that meet changing codes and complexities on today’s jobs.”

Owens Corning® ASJ Max FIBERGLAS™ Pipe Insulation product benefits include: • ASJ Max Poly-Encapsulated Paper Jacket: ASJ Max FIBERGLAS™ Pipe Insulation now has a poly-encapsulated paper jacket that is smooth, durable, cleanable, wrinkle-resistant, resists water staining and yellowing, and doesn’t support mold or mildew growth. When exposed to short-term precipitation during construction, the ASJ Max jacket will shed water to help prevent damage. The ASJ Max jacket is designed to have a compatible finish with standard ASJ, making it easy to achieve a neat, professional appearance on every job.

• Advanced SSL® Max Closure System: The new ASJ Max jacket features a customized SSL® Max closure system with advanced adhesives designed to work specifically with the new ASJ Max jacket to provide a tight, reliable seal without glue or staples. Pressure-sensitive butt strips complete the closure system to provide effective long-term vapor sealing of the butt joints. The combination of ASJ Max with SSL® Max closure system delivers a strong bond, easy installation and excellent long-term durability that stays tightly sealed in both extreme hot and cold conditions. This innovative closure system will also be available on our Vaporwick® Pipe Insulation product for below-ambient temperature pipes.

• Impressive Temperature Range: The ASJ Max offers an impressive temperature range and has been rated for operating at temperatures from 0°F (-18°C) up to 1,000°F (538°C) to deliver a solution to meet the needs of a broader range of applications, with proper heat-up schedule.

Owens Corning® ASJ Max FIBERGLAS™ Pipe Insulation is also available in select metric sizes for use with Aquatherm® pipe systems.

Monochrome is the New Black Technology firm’s new £6m campus development gets luxury finish.

Aliva UK has put a luxury monochrome finish on a state-of-the-art office development and datacentre for a Greater Manchester software firm.

A winning trio of natural stone, black terracotta and white bricks complete the exterior and interior look on the £6m 30,000 sq ft building for CDL. The Codeworks, which was designed by Edge Architects. CoreM was construction manager.

CDL Group chairman and co-founder Tom Hogg handed Aliva a brief that also included a requirement for a natural stone entrance hall floor and 12m high lift shaft on the building at CDL’s riverside campus.

Aliva, the UK leader in façades and interior finishes, executed an interior that incorporated more than 200 sqm of grey Jura limestone with tight 5mm joints and monolithic corners to give a traditional stone-built look.

Outside, Aliva provided 500 sqm of black Grescovering terracotta rainscreen cladding around

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an imposing three storey glass atrium. This, along with white Wienerberger bricks, created a crisp, high-tech façade.

Aliva sales director Justin Price said: “Tom worked with the architects on a host of creative ideas for the use of traditional stone, clay and brick on this beautiful building. Aliva took their vision and our expert design team translated it into a stand-out finish, incorporating high quality natural materials that give a very modern and unusual feel.”

Tom Hogg said: “The quality of the materials and technical work on the façade from Aliva UK were excellent, and the combination of stone and glass effectively evokes the binary code concept that lay behind the design. The new building looks stunning internally and externally, and its striking aesthetic contributes to the fabulous working environment we wanted The Codeworks to deliver.”

The building also has excellent sustainability, with ample natural light, efficient lighting and glazing, photovoltaic tiles and a solar thermal system. It is A-rated for energy efficiency, exceeding the standards set out in current building regulations.

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News

New Investment Portal Set to Change Funding in Construction

Stephen Moss, CEO of Pring.co.uk, commented on how the launch of the portal was impacting on the industry.

Investment portal Pring.co.uk attracts 5,000 agents A web portal which radically changes the way investors search for their next investment property has signed up 5,000 agents, less than six months since its launch.

Pring.co.uk took two years to develop and has already attracted estate agents across the UK who have uploaded more than 300,000 properties onto the site.

It is the brainchild of Stephen Moss who started his career in an estate agency before going on to co-found a number of other property businesses, including national chain, Legal 4 Landlords.

A key development is that, for the first time, Pring. co.uk allows users to search for investment properties which meet their exact requirements using a range of search criteria, including location, purchase price, rental value, mortgage cost, potential yield and return on investment.

More than 5,000 agents from across the UK have uploaded their properties and the site is attracting 100,000 plus visits a month.

The launch comes at a time of boom for the buy to let sector with almost one in five homes in Britain now owned by private landlords.

“There was a clear gap in the market for a search portal dedicated to investment properties. I was hearing the same issues from property investors time and time again. There was nowhere they could go to search for suitable investment properties in one place without spending hours and hours going through each property in a given location and working out the figures. Pring brings together all the figures an investor needs before deciding whether a house is worth viewing.

“We’ve developed the site to make sure it provides everything the property investor needs. They can look for properties in a specific area that give a particular return on investment and see immediately what the mortgage cost will be.”

Pring.co.uk can be used by investors of all budgets, ambitions and interests, with this flexibility making the product particularly appealing to investors who are handling multiple projects.

The site allows users to sign up to receive alerts when properties which match their criteria go onto the market. It also gives details of off market developments, discounted services and provides access to a dedicated investment specialist account manager.

The pricing structure is also designed to be completely user friendly. Agents subscribe to the site for a fixed fee of £60 per month plus VAT which allows unlimited property uploads, meaning they pay only one set of costs.

The new portal allows users to search through potential investment properties without having to go through a laborious process of searching for properties via various different estate agents, streamlining the process and saving both time and money for investors.

Lenscap Photography / Shutterstock.com Build Magazine

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Inside the Industry

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Bid Management… or Bid Mismanagement?

“This project is over budget, we aren’t going to deliver on time, the customer is not happy with us”.

hese are all too familiar statements when our clients ask us to identify process and control breakdown within projects which are not going to plan. Blame often falls at the door of the project director for failing to deliver the project, or even the quantity surveyor who has been unable to effectively manage the budgets. But is it always their fault or was the project doomed to fail before the first spade went into the ground? When projects go wrong too many construction organisations fail to effectively challenge themselves on the root cause of the issue. The elephant in the room is often that the opportunity was always too risky or the bid price was based on achieving subcontractor or value engineering savings that were unrealistic.

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the success of these organisations.

A strong bid management process helps an organisation make informed decisions by enabling them to: • understand the opportunity and the associated risks; • assess the resourcing and capacity implications on other projects and the wider business; • encourage innovative thinking as to how the customer’s requirements can be best achieved; and • establish a price that generates an acceptable return comparable with the risks identified.

This investment in bid management does, however, come at a cost. ‘The MarketingWorks Bid Cost Survey 2014’ Most organisations within the construction was a joint research project by Marketsector will have bid management capability ingWorks and the University of Reading which supports operational staff in evaluating that assessed bid cost investment in and responding to opportunities. Whilst this the construction industry. It concluded capability may vary in size and shape, from that, regardless of the size of an ora single commercial manager through to a ganisation, significant time and cost is whole team of surveyors and estimators, the incurred during this process. It calculatbid management process remains critical to ed the average cost of winning a single bid for a project valued between £2m - £250m was a staggering £60,208 with an average of 483 hours being committed. Proportionally, projects valued at less than £2m cost more to bid for, at 1.2% of the total project value, placing greater importance on an organisation’s win ratio given the sizeable investment.

Despite the upturn in the sector there have recently been a number of public, high profile examples where major construction firms have revealed significant losses within their construction divisions or on individual projects. Through

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Inside the Industry

Andy Monteith is National Head of Construction at accounting and business advisory firm Baker Tilly (www.bakertilly.co.uk)

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discussion with managing directors, commercial directors, finance directors and heads of internal audit from across the construction sector, common themes emerge that go some way to explaining why these issues may have occurred; • Stagnation in the sector during the recession, together with a reluctance from businesses to lose valued skills and expertise through redundancy, resulted in contractors effectively bidding for projects at low, or in some instances, no margin.

• Many project bid models included optimistic assumptions around cost and the ability to generate margins through squeezing subcontractors or achieving unrealistic savings through value engineering.

• Contractors agreed to commercial terms that were not favorable or exposed them to risk that was not adequately understood or evaluated.

• The risk of inflation on commodities such as bricks and steels was not adequately factored into cost assumptions and bid models at the outset which has resulted in significantly higher costs being incurred.

All of the above points can be caused or exacerbated by a poorly controlled and ineffective bid management processes and/or an inability to apply learnings from previous projects. Many organisations make the mistake in thinking that having a bid management process in itself must mean the process is controlled well.

Experience suggests that organisations with the fewest ‘problem child’ projects are those with robust governance arrangements, clear lines of accountability, transparent and open communication channels and an inclusive and collaborative culture, in addition to a robust bid challenge, review and sign off process. In this instance the ‘soft’ controls are just as important as the ‘hard’ controls.

Given the importance of the bid management process, the amount of

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time and effort spent focusing on this area by internal audit functions remains disproportionately low. The role of internal audit within the construction sector continues to be heavily concentrated on reviewing ‘live’ projects at various stages throughout their lifecycle, and resistance is often encountered to internal audit’s involvement at the very beginning, during the bid management stage.

• Is there a process for capturing and evaluating risks when evaluating new projects and contracts, ensuring they are within the organisation’s risk appetite?

• Are the costs associated with the development of bids understood and can this process be made more efficient whilst maintaining sufficiently robust controls?

The question often asked is whether the • Is the quality of data that underinternal audit function has the right skills and pins pricing and cost assumptions experience to sufficiently challenge the busicomplete, accurate and reliable? ness and provide the necessary assurances • Is the process for developing bids over the bid management process. This is a collaborative? Does it involve and valid question that must be considered if it is engage all key staff and expertise in a to be seen as a value adding function. High timely manner? performing internal audit functions regu• Is there sufficient contingency larly use internal or external subject matter allocated within the bid model for proexperts to support them in reviewing this visional sums and other ‘unknowns,’ area such as commercial specialists, quantity and has this been profiled across surveyors, project managers and specialist the project lifecycle to allow effective bid management experts from professional monitoring? services or boutique consulting firms.

• Are there delegations of authority, based on clearly defined criteria, for There remains a huge opportunity for Boards, both bid qualification and submitting executive management and, where applicable, bids? internal audit functions to challenge themselves • Do individual personalities disproas to how they can play a more proactive role portionately influence bid decisions in helping to establish robust controls within and circumvent the process? If so, the bid management process, from the outset, how is this risk managed? to enable more effective risk based decision • How are deviations from standard making and evaluation of bid assumptions and contractual terms identified and what costing, rather than once a project has comprocesses exist to ensure these are menced and/or after things start to go wrong. subject to appropriate review and approval?

What should be considered when reviewing • Are movements in contract value this area? and anticipated margin tracked throughout the bid management and subsequent negotiation process and, where necessary, submitted for reappproval?

• Is feedback obtained from both successful and unsuccessful bids and are these lessons used to continuously improve the bid process?

• Where a dedicated bid management function exists, is the role and objectives of this function clearly defined and are there appropriate performance measures in place to measure their effectiveness?

Seeking advice to help you identify weaknesses within your bid management and estimating and tendering processes could well pay dividends.

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Corruption Risk in the Construction Industry Corruption risk within the construction industry is high. A 2013 survey from the Chartered Institute of Building found that 49% of the construction professionals surveyed believed corruption to be common within the UK construction industry. These findings reinforced Transparency International’s (the leading global anti-corruption organisation) 2011 Bribe Payer’s Index which ranked the construction sector as having the highest propensity, out of 19 industry sectors, to pay bribes abroad.

hen taken together with the complex and fragmented contractual nature of construction projects (reliant as they usually are on third party contractors and consultants), the prospect of regular interaction with government officials and the global reach and active enforcement of anti-corruption legislation, the construction industry can present a daunting corruption risk profile.

public officials are illegal under the Bribery Act 2010 (the “Bribery Act”).

Significantly, section 7 of the Bribery Act also provides that a company can be held liable for bribery, wherever in the world it takes place, that is committed by associated persons acting on its behalf (e.g. third party contractors), even where the company had no awareness of the bribery.

Examined here are the reasons why why both companies and individuals should be alive to corruption risks as well as what those risks look like in practice and the pro-active steps available to identify, mitigate and manage those risks.

The only defence is for a company to show that it had adequate procedures in place to prevent bribery being committed by those third parties associated with it.

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Criminal exposure A failure to properly identify and mitigate corruption risk brings with it the potential for criminal investigation and prosecution of both a construction company and its individual managers and directors.

Paying and receiving bribes (in both the private and public sector) and bribing foreign

The consequences of a successful criminal prosecution can be dramatic and may include: • the imposition of unlimited fines; • imprisonment; • director disqualification; • the confiscation of assets; • debarment from participating in, or tendering for, government contracts; • a diversion of management and board time; and • reputational damage and adverse media attention.

These risks are real. The UK Serious Fraud Office and the US Department of Justice have both successfully prosecuted, and levied huge fines on, household names in the construction sector, including, amongst others: Balfour Beatty plc; AMEC plc; Mabey & Johnson Ltd; Technip and M.W. Kellogg Limited.

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By Lloyd Firth of International Law Firm, WilmerHale

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Compliance pressure points The first step in addressing corruption risk is for a company to be able to identify what these ‘compliance pressure points’ look like in practice. Each construction project will have its own set of facts but the following list reflects some of the most common pressure points: • Facilitation payments. Public officials often request payments to facilitate the smooth transit of construction supplies through ports and airports or for obtaining visas for employees. Whilst such requests are common, facilitation payments are illegal under the Bribery Act. • Tender risk. During a competitive tendering or bidding process construction companies should be alive to the risks of any excessive corporate gifts and hospitality expenditure being made around the time of the tender award.

• Partner risk. Construction projects are heavily reliant on a web of third parties, including sub-contractors, consultants and venture partners, amongst others. This can cause huge problems given a company can be liable for bribes paid or solicited by a third party under the Bribery Act. • Construction permits, licences and planning permissions. Most construction projects rely on being granted a government permission or licence of some kind. Seeking such approvals will inevitably increase the opportunity for corrupt payments to be made or demanded.

ance response, including: • A public and unequivocal tone from the top, making it clear that corruption, in any form, will not be tolerated.

This should be evidenced by anti-corruption being a standing item on the Board’s agenda.

• Carrying out a regular, by-country risk assessment, to effectively identify and prioritise corruption risk.

• In response to the risks identified as part of the risk assessment, crafting and implementing a written set of policies and procedures that cover off, amongst other items; facilitation payments, gifts and hospitality expenditure, procurement, political and charitable contributions and sponsorships. It is crucial that such policies and related internal controls are subjected to routine external verification to regularly test that they are not being bypassed in practice.

Regular training should be provided and include a process of annual certification for those staff members who are ‘on the ground’.

• Proportionate, risk based due diligence should be undertaken prior to entering into any contractual arrangements with third parties. This should include local site visits and in-person interviews where appropriate.

• All third party contracts should Compliance response be drafted to include terms that A well-designed compliance programme provide for audit rights over a third needs to be bespoke, risk based and proparty’s books and records, a unilateral portionate. Whilst there is no one-size-fits-all right of cancellation in the event of a approach, there are certain hallmarks of any corruption related breach and a fixed effective anti-bribery and corruption compliannual term.

• Establishing an effective and well-resourced whistleblowing programme. To ensure that this works well in practice it should be available in the relevant local language and ideally be available for use by third parties.

• Actively participating in sectoral anti-corruption initiatives with stakeholders such as governments, suppliers, contractors and joint venture partners.

Conclusion Whilst corruption risks in the construction sector are real and can have potentially debilitating consequences, it is hoped that this article makes it clear that they are also more than capable of being identified and mitigated against in a proportionate manner.

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Crowdfunding and Development Finance Richard Bush, Co-founder of CrowdLords.com, discusses how crowdfunding is changing the face of funding in the US property market.

There’s a revolution happening US Real Estate financing that T in is changing forever how developments are funded, and it’s all down to Crowdfunding.

For those not familiar with the term, Crowdfunding started as a way for social and charitable projects to raise funds from everyday people using web based technology platforms.

This then evolved to enable start-ups and small businesses to raise funds by offering equity in return for small investments from hundreds of people. It didn’t take long for someone to realised that there was an opportunity to use this model to fund real estate.

Whilst it’s still relatively new, the growth has been astronomical with over 80 platforms launching in the US in the last three years and the top 3 platforms alone completing more than $3bn of transactions.

Things are happening a lot slower here in the UK, but there are signs that both investors and developers are beginning to see the opportunity. Whilst alternative finance in the form of

Peer-to-Peer loans, initially bridging finance and now longer-term debt finance, has been available from players like LendInvest and Wellesley & Co for a couple of years, there were no equity based options available. Which is why we launched CrowdLords.

Private sources of finance have always played an important role in the funding of smaller developments, with developers nurturing and protecting their own networks of individuals willing to fund JVs in return for a share of the profits.

Equity crowdfunding simply replaces or supplements those personal networks with a crowd of investors enabling both sides to spread their risks. If the same happens here as has happened in the US, it will dramatically increase the funds available for developments, with institutional investors as well as smaller savers clubbing together to fund everything from residential refurbishments to blocks of flats or commercial developments.

This is a big opportunity for developers. Banks are, by their very nature, fixed in their ways and slow to innovate.

The crowd, on the other hand, has proven to be quick to spot an opportunity and willing to share risks - as long as they also share the rewards. This means that for forward thinking developers there’s tremendous scope to rethink their business models to accommodate these new sources of funds.

Platforms like CrowdLords currently work with residential developers in three main ways. The first is the most obvious. Simply by supplementing, or replacing ‘private equity’ with ‘crowd equity’ we can provide the initial capital

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needed to secure bank debt on a joint-venture basis. This is ideal for small change of use projects or new build developments that can be completed in a reasonable time frame offering investors a share of the profits on completion and sale.

The second opportunity exists for the increasing number of developers who see the benefits of Develop-to-let. With the demand for rental properties increasing whilst the number of people able to buy decreases, it is becoming increasingly popular in city centres.

In these situations developers can use platforms like ours to release capital or repay debt by replacing it with equity from the crowd. The developers arrange the letting and management of the units and share the income and a proportion of the capital growth at the end of term – usually 5 years post completion. In exchange, the developers increase the overall return they generate from each unit they hold on to, meaning their profit per development as well as their cash flow increases.

Finally, crowdfunding can be seen as a new sales channel and this is particularly relevant to developments aimed primarily at the investment market. An area that is becoming increasingly competitive as the number of developments grows whilst the number of investors able to afford a single unit remains limited.

Some prefer to pre-sell units off-plan to help secure debt and here they can use crowdfunding to open up their propositions to a much wider audience. Potential landlords who are unable to put up the entire deposit

themselves can be offered the opportunity to crowdfund the rest. Some developers decide to act as the Landlord by leaving a small amount of equity in each unit. It can be a very powerful sales tool that reduces the marketing costs and speeds up off-plan sales which can make a difference to their ability to secure debt as well as their overall margin.

Example Prosperity Fund are a proven and respected property development business operating mainly in the Midlands. They specialise in high quality apartments sold mainly to investors, many of which are based overseas. One of their apartments is currently listed on CrowdLords as an ‘Offplan’ investment offering investors two classes of shares with different returns. Those that commit funds ‘Offplan’ now are entitled to a larger share of the capital growth than those that invest on completion.

There’s no doubt that this is just the beginning of how alternative finance is bringing innovation and creativity to development funding. Platforms like ours, and others that operate in the commercial sector, are always looking for new ways to enable more people to invest in property whilst at the same time supporting the supply of properties this country desperately needs.

We can see the potential by studying what has happened in the US. Volumes and value started low until the institutional funds saw the opportunities of investing alongside private individuals. Reducing their exposure to individual deals whilst at the same time giving the crowd more confidence to invest. It seems that things will take a little longer in the UK but the signs are that things are moving in that direction.

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East Africa’s Growth Story: Opportunities for International Construction Firms Andrew Ross, CEO of Spencon Ltd examines how East Africa offers international firms potential opportunities as infrastructure and the economy improve.

ast Africa is fast becoming a strategic hub for Africa’s growing construction industry. The number of mega construction projects in East Africa (excluding Mozambique) grew by 12% in 2013 alone due to increased investment from international construction firms. The surge in interest is in part due to the enormous potential that East Africa presents for investors, specifically around the construction and development of regional infrastructure systems so as to facilitate further economic growth.

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Infrastructure and support systems in East Africa, comprising all of its 20 countries, has historically been one of the world’s poorest and least developed, sharing only one quarter of the African infrastructure between 44 African countries. Experts estimate the region needs investment of around US$100 billion per year over the next decade for Africa to close the infrastructure gap and catch up with the rest of the world on basic requirements.

construction and engineering industry see the continent as one of the most popular prospects for further corporate expansion.

In our 35 years of operation in the region, Spencon has witnessed first-hand the surge of interest from foreign firms looking to take advantage of the opportunities in the region. Having partnered with many international companies and development agencies to deliver projects locally, we see the potential the region has in offering lucrative contract opportunities to international firms.

According to The Economist, six of the world’s ten fastest growing economies of the past decade are in sub-Saharan Africa. East Africa in particular continues to show promising year on year economic growth. Beyond 2016, it is also projected to become the continent’s fastest growing region economically. Supporting this growth With local and foreign investors noticing the opporhas created a multitude of opportunities tunities, there has been an eagerness to supply the for construction companies with the funding for such developments. East Africa recordexperience and expertise in delivering ed the highest increase in foreign direct investment infrastructure projects. Rapid urbanisation, in 2014 and has now caught the eye of international a growing middle class and an increasing construction firms looking to enter the African population size has encouraged many market. A recent KPMG Global Construction Survey African governments to seek to provide adfound that over 50 per cent of senior leaders in the equate infrastructure for their population. It has also presented an ideal opportunity for East African firms cement their place in the global construction marketplace. Foreign investors have noticed the lucrative investment potential of narrowing Africa’s infrastructure gap. The Chinese government, in particular, has been a keen investor in some of the larger infrastructure projects, like the recently started $13.8bn rail project, which will link Kenya’s Indian Ocean port of Mombasa to the capital Nairobi, then on to Uganda.

Furthermore, increasing collaboration and strategic regional integration within the region has paved the way for cross-border infrastructure projects. This has opened up oppor-

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tunities for international construction firms due to the availability of financing for larger and complex cross-border infrastructure projects. Efforts by the East African Community (EAC) to facilitate regional growth through integration has also led to increasing demand for expertise in the field which international firms can provide. Over the past decade, Spencon has worked with a number of international firms to implement these cross-border projects, due to our local knowledge and flexibility across borders.

While countries within the EAC still differ substantially in their level of infrastructure development, great strides have been made in recent years to improve the services available to the region’s growing consumer base. Kenya, for example has begun to implement a significant roadworks programme financed by the African Development Bank, China, Brazil and Japan. The programme was aimed at critically improving its traffic congestion in Nairobi and its suburbs, whilst connecting Kenya with its neighbouring countries. During the programme, we worked with a number of international firms to deliver the project on time and on budget.

As Africa is projected to overtake the likes of India in terms of the population of its middle class, solving its power and energy crisis has also opened up an array of opportunities for international firms.

Both the public and private sector are placing significant focus in power generation infrastructure to support a thriving business environment and further economic growth within the continent. Hence, there has been significant contracts awarded over the past few years to foreign construction and engineering firms. Given our experience within this industry over the past 35 years, East Africa is showing exceptionally promising economic growth numbers and, coupled with the collaborative opportunities within the EAC, the time for international firms to get involved is now.

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How the Skills Shortage is Affecting Construction The number of skilled workers in the construction industry is dropping, threatening Government housebuilding pledge as well as private projects.

he UK wide construction industry skills shortage is affecting all sections of the industry, with projects often coming in over budget or being delayed thanks to the year-by-year reduction of skilled workers entering the industry and an aging population leading to many skilled workers retiring as the demand for houses increases.

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Housing is the sector seeing the most urgent demand, and local councils have recently warned that the shortage could derail the Government’s plans to build 275,000 new affordable homes by 2020.

New analysis by the Local Government Association (LGA), which represents more than 370 councils in England and Wales, reveals a growing mismatch between the construction industry’s increasing demand for skills and a falling number of people gaining construction qualifications.

While the construction industry’s forecasted annual recruitment need is up 54% from 2013, there are 10,000 fewer construction qualifications being awarded by colleges, apprenticeships and universities.

The number of people gaining construction skills has been falling for some time. There were 58% fewer completed construction apprenticeships last year than in 2009. Meanwhile, industry has increasingly

struggled to fill vacancies. A worrying 56% of skilled trade construction vacancies are hard to fill, up from 46% in 2011 and almost triple the proportion of skilled hard to fill vacancies across the economy as a whole.

As the economy continues to improve, demand continues to rise, with private contractors often seeing profit margins reducing or passing on the cost directly to the consumer, which could impact on inflation over the coming years if the skills shortage is not addressed.

Recent figures released by Ionic Recruitment, a specialist recruitment consultancy within construction, show that skilled operative have seen their salaries sore over the past year. Quantity Surveyors had a 45% increase in salary since 2014. Temporary workers have also had pay hikes, with painters and decorators seeing a 46% rise, ground workers 23% and joiners 15%.

Martyn Makinson, Managing Director of Ionic Recruitment, commented on this surprising development: “Some may predict that permanent workers see bigger increases in wages as temporary workers tend to barter more to secure contracts. Our figures show that, actually, the wage increases are pretty similar across both, which is good news in general for the construction sector as a whole.”

Tim Stringer, Director of Integral Build, believes that the key reason for the shortage is that the industry is not appealing enough to young people. The recession led to staff leaving the industry to retrain and other staff have retired or moved into management roles within the industry, whilst fewer and fewer are entering into the industry from the bottom.

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Stringer describes the industry as “old fashioned”, and feels that this is a key problem which needs to be resolved in order for UK construction to move forward and overcome the skills shortage.

Additionally, diversity is also a key problem.

Although Integral Build has a team of which 25% are female and partners with the Women in Property organisation, which aims to raise the profile of women in construction, there are still not enough women in the industry as a whole. Again, Stringer believes that a change in image is crucial, with the perception of a dirty all boys club needing a drastic overhaul in order to encourage more women to study construction skills whilst in education.

In terms of moving forward, the Director of Integral Build, a specialist fit out and refurbishment contractor, believes that automation is not a route which will be successful, but that rather efficiency needs to become a top priority.

“There are lot of things that can be done to make us more efficient as an industry. I know that some of the very large construction companies have started to suggest that there are some automated processes that could take place on site but I think we are a long way away from seeing those being an everyday reality across the UK. “I think, in general, we are quite a wasteful industry in terms of how we procure projects, how we build things on site, we need to be looking at more efficient ways of procuring projects and the tendering process that a lot of clients go through and we’ve got to look into how we can be more efficient onsite, using better materials, more efficient methods, looking at ‘lean techniques’.

“These are all things we need to be doing, as traditionally the construction industry has been very old fashioned and that’s something we need to change to ensure we are offering the very best value to our clients and the best environment for new staff to enter.”

Overall, a complete image overhaul for the industry can do no harm, and with the skills shortage showing no signs of abating, action is required sooner rather than later to stop the industry from running out of skilled workers.

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The Skills Shortage: An Industry Perspective Crystal Fernandes, Employment and Skills Manager at Circle Housing, examines how the shortage has affected those working within the industry and discusses what the industry is doing to combat it.

ecent research from the Local Government Association has revealed a drop in the number of construction apprenticeships by 10,000 despite a 54% increase in industry recruitment demand. These figures are a stark warning that the construction sector’s recovery from the financial crisis may be far from over.

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As Employment and Skills Manager for one of the country’s leading providers of affordable homes, Crystal Fernandes says that Circle Housing understands only too well how important these kind of construction jobs are when it comes to delivering desperately needed new homes across the country.

The right training opportunities hold the key to delivering the much needed skilled construction workers of the future, Crystal believes. However, Circle Housing’s own experience has shown that there are many firms that struggle with both the recruitment and affordability of new workers. For example, many apprentices can find themselves without a site to work on and unable to complete their training once a development has been completed.

As a large housing provider with over 70,000 properties across England, Circle Housing helps to create new jobs for people living in its communities and helps them develop the skills to secure the

best opportunities. Staff working at every level of Circle Housing are passionate about helping get residents into long-term sustainable employment that will increase their confidence, well-being and sense of belonging. This also puts these resisdents in a better position to manage their money and pay their bills and in turn, become more financially independent and resilient.

Last year the firm invested £3.3m into services like this, which go beyond the act of letting a home to helping people find work, manage their money and save on their energy bills. Locally, each of its regional partners has a dedicated budget for programmes and these are developed based on local demographics and economic needs.

This programme is run by using Circle Housing’s buying power to create jobs and training opportunities through procurement, embedding social clauses into procurement documents and ensuring that they are delivered through measured and monitored KPIs for new developments. The firm builds stronger partnerships with its supply chain by informing them of the tools, techniques and best practice needed to deliver their social clauses and increase skills and employability.

A key issue for the sector lies in encouraging residents to take advantage of these opportunities, as the construction sector can seem unappealing. Circle Housing attempts to overcome this issue by running training programmes with its contractors to prepare local people for work and to help them secure the apprenticeships and jobs created as a result of the agreements at the end of the training.

It is important work, delivered in partnership with the construction industry, which

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addresses the skills shortage in the sector by helping more people access new training, work experience, job and apprenticeship opportunities in the sector. Last year, Circle Housing’s programme created more than 5,000 training and employment opportunities for people living in local London communities.

The company also works with other housing associations and contractors in London as partners in the Evolve shared apprenticeship scheme, which helps create more opportunities for apprentices in the capital so that they can complete their training.

Evolve is London’s first not-for-profit shared apprenticeship scheme backed by the CITB, following the success of similar schemes running up and down the country. The central aim is to remove the burden of traditional apprenticeship programmes on individual employers by spreading the cost and training obligations across several organisations and matching newly recruited apprentices with different employers over the course of their training. This creates serious programmes that enable apprentices to complete their training and provide the much needed construction professionals to build the homes of the future. Circle anticipate that 500 new construction opportunities will be given to Londoners over the next decade as a result of this particular project.

Circle Housing believes that the housing sector can support hundreds more people to gain the right skills and qualifications so they can drive the construction industry forward.

The key to all of this is working collaboratively with contractors, local authorities and other housing associations.

More information about Circle Housing’s programme can be found at www.Circleopportunities.org.uk

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Carbon Emission U-Turn Can Only Create Market Uncertainty

By Neelum Mohammed, Associate Director in Sustainable Engineering at CBRE

In an unexpected and controversial move the Treasury last month canned plans to make all new homes carbon neutral from 2016, reneging on a commitment made in 2008, and casting doubt on the sincerity of the government’s ambitions to cut carbon emissions by 80% by 2050. The announcement was a blow for the industry, as was the news that plans are also being shelved for the roll-out of zero carbon standards for non-residential buildings; which had been due to see the light of day in 2019.

When the plans were put in place, the government’s aim was to improve the energy efficiency of both residential and commercial real estate by imposing technical building standards that would position the UK on a par with its Nordic and northern European counterparts. The benefits go beyond purely the environmental; with these efforts to control demand for energy expected to reduce fuel poverty and bring down energy expenditure for hundreds of thousands of homes every year.

For non-domestic buildings, the strategy was to encourage energy efficient design.

July’s U-turn came as part of the government’s report, ‘Fixing the foundations: Creating a more prosperous nation’, and said that scrapping the regulations was designed to “reduce net regulations on housebuilders”.

However, while this may be considered positive news in the short term for both non domestic and domestic developers, it can only harm the prospect of long term savings for the end user. The decision appears not to consider the missed long-term opportunities in further innovation and manufacturing, in particular low carbon products and services; employment growth and research, and could ultimately hinder UK’s leadership place within the international forum too, particularly at the Paris 2015 United Nations Climate Change Conference at the end of the year.

Earlier this year, the outcome of the Housing Standards Review and the subsequent Deregulation Act 2015 saw the removal of the Code for Sustainable Homes standard on new housing. At the time, it was understood that housing developments fewer than 10 units would be exempt from energy efficiency standards but now everything else will need to comply via Part L of the building regulations.

It has also been reported that the Department for Communities & Local Government is looking to discard the zero carbon commitment for non-domestic buildings too.

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The decision means there is now no intention to proceed with the zero carbon Allowable Solutions carbon offsetting scheme, and the forecasted energy efficiency drive in 2016 via technical building standards. This has serious implications for a property building sector which has invested heavily in meeting the requirements first put in place in 2006 by the then chancellor Gordon Brown.

The UK was one of the first countries to put in place the zero carbon homes policy, designed to support the government’s zero carbon commitment to work towards the Climate Change Act’s goal of reducing carbon emissions by 80% by 2050. The removal of the carbon neutral homes pledge undermines the last seven years of innovation and industry progression towards energy efficient design to ultimately deliver zero carbon buildings, and casts serious doubt as to how the Climate Change Act’s objective will be achieved.

In its place, the government has instead announced it “will keep the energy standards under review, recognising that existing measures to increase energy efficiency of new buildings should be allowed time to become established”.

There’s still every hope that the zero carbon target could be delivered in the long term, but without a sound base from which to build, and the scale for improvement, the U-turn has merely served to create uncertainty in the market, and diminish confidence in our carbon neutral future, right when it is needed most.

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Act Now to Make the Most of the PV Opportunity

Announced this summer, Government plans to reduce subsidy support for UK solar PV installations were met with widespread disappointment across the industry. However, in the face of uncertainty, there is still an enormous solar PV opportunity at hand for non-domestic users – and after recent decisions, the time to act is now.

One of the most headline-grabbing developments to impact the UK solar PV industry in recent months has been proposed government cuts to the Renewables Obligation (RO) and feed-in tariffs (FiTs) – which are the main financial incentives in place to drive uptake of non-domestic renewable electricity technologies. Initial proposals announced in July by the Department of Energy and Climate Change (DECC) outlined plans to stop RO subsidies for solar arrays under 5MW from 1st April 2016. They also indicated that spending cuts to FiTs (including the removal of pre-accreditation) are in the pipeline. However, while many feel that the sector has been dealt a major blow by the planned cuts, now is certainly not the time to panic.

As a leading energy provider, at Flogas Renewables (part of Flogas Britain Ltd) we’ve seen the solar industry go through its ups and downs over the years. It has faced similar setbacks and uncertainty about government incentives in the past, and yet it has remained resilient – continuing to find ways to reinvent itself and thrive in challenging conditions.

Although changes to subsidy will undoubtedly cause some casualties along the way, solar PV is still a crucial part of the UK’s future energy mix. In light of this, as a company, we’ve worked hard to develop an offering that makes longterm commercial sense for businesses – and it’s important that people don’t lose out on this by dwelling on the ‘what ifs’.

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A window of opportunity Despite the disappointing framework of the consultations, at the time of writing nothing had been set in stone. Yes, it’s likely that the proposed changes to support mechanisms will go ahead as planned, but in reality we won’t see the impact of these for at least a few months. The timings outlined in the original announcement suggest that we do have some certainty on the RO for the time being – and solar projects of 5MW or less (either roof- or ground-mounted) will still be eligible for RO support until 1st April 2016.

The consultation also included a proposal to end pre-accreditation for FiTs. Under the current framework, it’s possible to submit an application for a proposed solar PV installation in advance, and obtain a tariff guarantee that’s valid for a limited time ahead of system commissioning – a practice that will come to an end should the consultation go ahead as planned. On top of this, DECC has confirmed that it is looking into further cost-control measures that will have an impact on the scheme.

However, we’re not expecting these changes to be instant.

All of this means that there is an immediate opportunity at hand.

With concrete decisions yet to be

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Eco Building

By David Taylor, National Sales Manager, Flogas Renewables For more information visit Flogas.co.uk

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made, it is the perfect time to make the most of the current level of support by signing up for assessments and moving existing solar projects forward. However, whilst in the short term the timeframe for today’s RO and FiTs framework is running out, the long-term advantages of solar PV remain intact. As an established technology, PV panels have solid track record in delivering clean, safe and reliable electricity for large-scale applications – and with such compelling benefits, the case for solar moving forward remains strong.

Taking a long-term view Whilst subsidies undoubtedly have an important role to play in boosting uptake, it’s important not to let any short-term uncertainty over incentive payments overshadow the huge role PV is set to play in meeting the UK’s energy needs. Away from the policy debate – and whatever the outcome of the consultations – businesses across the country are under increasing pressure to cut their costs and carbon emissions quickly. What’s more, the UK has a commitment to generating 15% of its energy – and specifically, 30% of its electricity – from renewable sources by 2020.

Those businesses that invest in renewable solutions like solar PV now will not only provide a much-needed contribution to government targets in the run-up to 2020 and beyond – they will also benefit from a cleaner and more secure energy supply for many years to come.

Unlike competing technologies, solar PV is relatively easy and quick to deploy, making it truly viable on a national scale. As a result, it has become a leading option for a whole host of non-domestic buildings that are looking to substantially reduce overheads and cut energy consumption, whilst demonstrating clear sustainability credentials to their stakeholders.

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Solar is the ideal renewables option for buildings with unused space and makes business sense for applications with a high electricity demand.

Roof- and ground-mounted systems provide a reliable source of energy even on cloudy, overcast days. They also work seamlessly alongside more conventional energy sources, making it easy to integrate into a building’s existing power setup.

For best returns businesses can also design a bespoke system to meet their own individual electricity demands (known as solar self-consumption). This allows them to benefit from stable long-term electricity prices – instantly reducing their reliance on energy imported from the grid, and protecting them against future increases.

A bright future Even without taking incentives into account, businesses that make solar PV a part of their energy mix can rely on a future-proof energy supply – one that is cleaner, greener and more secure. It not only cuts emissions and provides a clear competitive advantage, it also protects against supply volatility, potential shortages and price increases.

What’s more, with self-consumption, solar can provide significant savings on a building’s energy costs on a day-to-day basis. These long-term rewards mean that whilst at the moment there may be uncertainty on the horizon, in the UK the boat for solar PV has far from sailed. In fact, it’s very much still anchored – and now’s the time to get on board.

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Adapting to the BIM Way of Working for Longer-Term Value

By Allen Preger, Co-Founder and VP Global Accounts, Newforma

he building industry is on a tight deadline; by March next year, the UK Government requires all central government infrastructure projects to be achieving Level 2 BIM capability.

After this date, any companies competing for government contracts will need to employ the fully collaborative project delivery practices described in the BIM Level 2 mandate.

suppliers – allowing input from each specialist to be factored into all decisions that concern them. In other words, to maximise the opportunity that BIM presents, the project is built digitally before ground is broken in real life. To do so, you need to compress the collective input of all the project stakeholders at the start of the project.

Early returns indicate that BIM [Building Information Modelling] can offer companies complying with it’s guidelines a wealth of benefits; in fact, recent NBS research showed that of those firms adopting BIM, 59% have seen cost efficiencies, 56% have seen an improvement in client outcomes, 51% have increased the speed of delivery, and 48% have achieved an increase in profitability.

So how is this input captured in practical terms? A BIM project consists of a loose federation of interrelated, domain-specific digital models authored and/or informed by the assembled project stakeholders. The more detailed and coordinated these models, the more accurately they simulate the finished project. In turn, these information-rich models also automatically generate many of the project’s required deliverables, including plans, details, specs, quantity takeoffs and other documents, typically as PDF datasets numbering into the thousands.

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But these companies have also learned there are additional considerations that must be addressed to maximise the potential of BIM Level 2 from a longer-term perspective.

Collaboration at the heart of BIM The nature of BIM brings all project stakeholders together at the start of a project – client, consultants, contractors, subcontractors,

And as with manufacturing, the more prototypes you build and test, the better the end product. Therefore these models are in a constant state of refinement as the team strives to optimize form and function, eliminate construction waste and minimize operating costs. With each iteration comes another batch of file-based model derivatives for distribution, review and input by the team.

The benefits of BIM are well documented. Less publicized, but acknowledged by many of its early practitioners, is the obvious by-product: an expo-

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nential increase in the amount of information generated as compared to traditional project delivery methods.

Taming the resulting data explosion While in an ideal world all project collaboration would be done face-to-face, the reality of highly-iterative BIM projects is that queries, issues and decisions are largely settled and documented via email. These collaborative cycles continue throughout the duration of a project, so effective management of both BIM-related deliverables and email correspondence is a fundamental consideration for all project stakeholders.

Furthermore, efficiency-boosting information management tools that integrate seamlessly across all existing systems can simplify project information discovery and ensure the responsiveness of project stakeholders. Apps on phones and other devices are a great example of this; they eliminate bottlenecks in BIM-improved processes when they allow team members to to easily access current versions of documents and supplement them with live observations and updates from the field.

Hilson Moran’s approach to BIM Hilson Moran completed the 20 Fenchurch Street (also known as London’s iconic Walkie Talkie building) project in BIM just one year ago. As the first office tower in the City of London to have been conceived, co-ordinated and designed 100% in 3D, Vince Ugarow, partner and project director, noticed that having project information in silos was a big challenge for his team.

He deployed the solution from Newforma which he says created an integrated project data environment, in turn creating “clear time, cost and efficiency savings.” The 105,000 emails documenting the myriad of queries, issues and decisions surrounding the BIM processes were made instantly discoverable, down to the level of PDF attachments. According to Ugarow, “It converted the liability of email previously buried in individual inboxes into an information asset.”

Furthermore, Ugarow was quick to recognise the benefits of PIM in harnessing the pervasive growth of mobile technology in construction: “The Newforma solution includes integrated apps that save time and improve the quality of information, whether we need to capture field notes, snagging lists or carry out inspections in the field.”

“These apps integrate with BIM and other software we use at the desk to avoid creating another information silo,” Vince adds. “These information silos are one of the industry’s biggest challenges. A PIM solution that stitches them together to form an integrated project data environment creates clear time, cost and efficiency savings.”

Unlocking the benefits of BIM When properly implemented, BIM is delivering huge benefits to all project stakeholders. However, the continued adoption of BIM across projects in the building sector, coupled with an increasingly collaborative way of working, is driving a tsunami of information that threatens to derail even the most disciplined companies.

PIM [Project Information Management] provides the vital support that is required to manage this data across the many silos in which it accumulates.

For this reason, PIM is increasingly important across a sector heading in a direction where data rich modelling will soon become tantamount to the design process. By implementing tools like this, firms will be able to better manage inputs and outputs that will help them unlock the long-term benefits of BIM.

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Meeting the Evolving Challenges of Architectural Security in a Global Age

By Jonathan Goss, Managing Director, Townscape Products Limited

One of the major challenges facing architectural design is reconciling robust security with attractive aesthetics. Security is rarely associated with grand design, yet given the inherent security threats posed by an increasingly globalised world, incorporating effective security into building architecture is essential.

How can design protect both places and people without jeopardising appearance?

How can perimeter security work to protect buildings without making them look like high-security prisons? These are important questions for all architects. With the threat posed to buildings evolving, the presence of CCTV cameras on a premises is no longer sufficient to deter security threats. Similarly, high concrete walls and barbed wire fences are undesirable from an aesthetic viewpoint.

The National Counter Terrorism Security Office’s list of buildings particularly at risk includes premises as wide ranging as clubs, bars, shopping centres, stadia, schools and places of worship. It’s clear that, given the variety of buildings considered to be at risk, there is a lot to consider when it comes to designing effective and discreet perimeter security solutions. The challenges which face architects are complex and numerous, not least because of the duty of care they have for the public using the spaces they have designed, outlined by the Royal Institute of British Architects in their ‘RIBA Guidance On Designing For Counter Terrorism document.

So what solutions exist on the market, and how can they provide the security high-risk buildings need without damaging their appeal?

Security through innovative design With duty of care in mind, it is important to ensure that perimeter security products installed to protect vulnerable premises meet the UK security industry standard – PAS 68.

Counter-terror (CT) blocks, bollards and planters are all available at this specification and can help provide strong and effective security as part of a hostile-vehicle-mitigation (HVM) system. These systems work to deter the type of vehicle-bound assaults which have come to be associated with terrorist atrocities and pose a significant threat to buildings in which large numbers of people gather.

The most popular HVM product we offer is the CT block – a reinforced PAS 68 concrete block capable of immobilising a 7.5 tonne

Jannis Tobias Werner / Shutterstock.com Build Magazine

vehicle. These CT blocks weigh 2.2 tonnes and need only to be recessed 100mm below the ground. This puts the product in stark contrast to traditional security produces, such as ram-raid bollards, which require much deeper foundations and, therefore, may not be able to be implemented in instances where underground utilities such as power cables, data cables and water pipes are present.

The implementation of a HVM system negates the need for obtrusive concrete walls or barbed wire. Instead such a system allows for perimeter security which can be suitably tailored to its setting, blending in with surroundings and often services a multiple purpose – providing seating for pedestrians or even plant beds for flora.

20 Fenchurch Street A prime example of an effective HVM system can be found in the work we completed for the Rafael Viñoly designed 20 Fenchurch Street in London.

20 Fenchurch Street, well known as the ‘Walkie Talkie’, is now one of the iconic skyscrapers which characterises the City of London skyline. It is remarkable for its innovative design, which sees enlarged flooring plans at the top of the building rather than the bottom.

Townscape were enlisted by engineering consultants QCIC to install a state-of-theart HVM system which would provide robust protection to the building while also creating a high-quality, multi-purpose urban landscape around the base of the skyscraper. In response, we developed and installed 6 granite-laden PAS 68 CT blocks complete with LED spot lighting to create an effective security solution which complemented the surrounding architecture.

Situated at the base of the building, this HVM system provides 20 Fenchurch Street with a robust deterrent to vehicle-bound attacks. At the same time, the system also provides the public with seating in the plaza surrounding the building, properly fulfilling the multi-purpose-function brief provided while enhancing the aesthetics of the area.

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Architectural security overseas The variety of structures which require effective security solutions differ greatly, from schools to skyscrapers and stadia. Security architecture must be capable of providing protection for both smaller structures and large complexes, and must be able to do so across a range of environments.

The King Abdullah Sports City, valued at $507 million and known as Saudi Arabia’s ‘jewel in the desert, plays host to the Kingdom’s first FIFA-standard football stadium, a 2,000-seat multi-purpose indoor stadium, a 1000-seat athletics pitch, hotels, a Mosque and a sports hospital.

With a large number of potentially vulnerable buildings situated across a vast area, providing effective security, which did not jeopardise the aesthetic of the complex, was a unique challenge.

Through the installation of 600 PAS 68 standard CT blocks, the King Abdullah Sports City realised a comprehensive security solution to provide essential protection against the threat of vehicle-based attacks. This provides a pertinent example of the demand for an aesthetic approach to architectural security on an international scale and highlights its importance to architects across the globe.

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Opportunities presented by architectural security As security threats morph and evolve, so architectural security must too. There is now worldwide demand for security solutions which provide robust protection while not only preserving but often enhancing the design and appearance of the premises they are installed to protect.

This provides challenges to architects, but bespoke products such as the CT block offer exciting opportunities too.

Through the use of purpose-designed HVM systems, security installations can meet the stringent security demands associated with landmark premises while also serving to improve their surroundings. Architectural security can utilise stylish design to ensure perimeter security compliments the existing aesthetic of the buildings it is implemented to protect.

Through embracing multi-purpose solutions, architectural security can offer highly-effective installations which ensure their security purpose remains discreet.

For more information visit www.townscapeproducts.co.uk or call 01623 513 355

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